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TOL vs. NVR: Which Stock Is the Better Value Option?
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Investors with an interest in Building Products - Home Builders stocks have likely encountered both Toll Brothers (TOL - Free Report) and NVR (NVR - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Toll Brothers and NVR have a Zacks Rank of # 1 (Strong Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. However, value investors will care about much more than just this.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
TOL currently has a forward P/E ratio of 8.68, while NVR has a forward P/E of 15.66. We also note that TOL has a PEG ratio of 0.99. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. NVR currently has a PEG ratio of 3.55.
Another notable valuation metric for TOL is its P/B ratio of 1.65. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, NVR has a P/B of 5.53.
These are just a few of the metrics contributing to TOL's Value grade of A and NVR's Value grade of D.
Both TOL and NVR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TOL is the superior value option right now.
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TOL vs. NVR: Which Stock Is the Better Value Option?
Investors with an interest in Building Products - Home Builders stocks have likely encountered both Toll Brothers (TOL - Free Report) and NVR (NVR - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Toll Brothers and NVR have a Zacks Rank of # 1 (Strong Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. However, value investors will care about much more than just this.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
TOL currently has a forward P/E ratio of 8.68, while NVR has a forward P/E of 15.66. We also note that TOL has a PEG ratio of 0.99. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. NVR currently has a PEG ratio of 3.55.
Another notable valuation metric for TOL is its P/B ratio of 1.65. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, NVR has a P/B of 5.53.
These are just a few of the metrics contributing to TOL's Value grade of A and NVR's Value grade of D.
Both TOL and NVR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TOL is the superior value option right now.